Case T-562/10

HTTS Hanseatic Trade Trust & Shipping GmbH

v

Council of the European Union

(Common foreign and security policy – Restrictive measures against Iran with the aim of preventing nuclear proliferation – Freezing of funds – Actions for annulment – Duty to state reasons – Procedure by default – Application to intervene – No need to adjudicate)

Summary of the Judgment

1.      Acts of the institutions – Statement of reasons – Obligation – Scope – Restrictive measures against Iran

(Art. 296, second para., TFEU; Council Regulation No 961/2010)

2.      Actions for annulment – Judgment annulling a measure – Effects – Limitation by the Court – Regulation imposing restrictive measures against Iran – Partial annulment for infringement of the duty to state reasons – Need to safeguard possible justification for those measures as regards the substance – Maintenance of the effects of that regulation during a period allowing for its possible replacement

(Art. 264 TFEU; Statute of the Court of Justice, Art. 41; Council Regulation No 961/2010)

1.      The purpose of the obligation to state the reasons for an act adversely affecting a person, as laid down in the second paragraph of Article 296 TFEU and, more particularly, as regards a decision to freeze funds taken under Article 16(2) of Regulation No 961/2010 on restrictive measures against Iran and repealing Regulation No 423/2007, in Article 36(3) of Regulation No 961/2010, is, first, to provide the person concerned with sufficient information to make it possible to determine whether the act is well founded or whether it is vitiated by an error which may permit its validity to be contested before the Courts of the European Union and, second, to enable those Courts to review the lawfulness of the act. The obligation to state reasons thus laid down constitutes an essential principle of European Union law which may be derogated from only for compelling reasons. The statement of reasons must therefore in principle be notified to the person concerned at the same time as the act adversely affecting him and a failure to state the reasons cannot be remedied by the fact that the person concerned learns the reasons for the act during the proceedings before the Courts of the European Union.

Consequently, unless there are compelling reasons touching on the security of the European Union or of its Member States or the conduct of their international relations which prevent the communication of certain information, the Council is required, under Article 36(3) of Regulation No 961/2010, to inform the entity covered by a measure adopted under Article 16(2) of that regulation of the actual and specific reasons why it considers that that provision is applicable to the entity concerned, stating the matters of fact and law which constitute the legal basis of the measure and the considerations which led it to adopt that measure.

Moreover, the statement of reasons must be appropriate to the measure at issue and to the context in which it was adopted. The requirements to be satisfied by the statement of reasons depend on the circumstances of each case, in particular the content of the measure in question, the nature of the reasons given and the interest which the addressees of the measure, or other parties to whom it is of direct and individual concern, may have in obtaining explanations. It is not necessary for the statement of reasons to specify all the relevant matters of fact and law, since the question whether the statement of reasons is adequate must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question. In particular, the reasons given for a decision are sufficient if it was adopted in circumstances known to the party concerned which enable him to understand the scope of the measure concerning him.

Where the reasons provided by the Council to justify placing an entity’s name on the list of the persons, entities or bodies to which a measure freezing funds applies pursuant to Article 16(2) of Regulation No 961/2010 are inadequate having regard to those requirements, it must be concluded that the obligation to state reasons laid down in the second paragraph of Article 296 TFEU and Article 36(3) of that regulation has been infringed, and that regulation must be annulled in so far as it concerns that entity.

(see paras 32-34, 36, 39-40)

2.      Inasmuch as Regulation No 961/2010 on restrictive measures against Iran and repealing Regulation No 423/2007 must be annulled in so far as it concerns an entity covered by a decision to freeze funds taken under Article 16(2) of that regulation for infringement of the obligation to state reasons, it cannot be excluded that, as regards the substance, the imposition of restrictive measures on that entity could none the less be justified.

Thus, the annulment of Regulation No 961/2010 in so far as it concerns that entity, with immediate effect, might do serious and irreparable harm to the effectiveness of the restrictive measures imposed by that regulation since, in the interval preceding its possible replacement by a new measure, that entity could engage in conduct intended to circumvent the effect of later restrictive measures.

Consequently, pursuant to Article 254 TFEU and Article 41 of the Statute of the Court of Justice, the effects of Regulation No 961/2010, inasmuch as it places that entity’s name in the list comprising Annex VIII thereto, must be maintained for a period of no more than two months from the date of delivery of the judgment.

(see paras 41-43)